Page last updated at 15:44 GMT, Monday, 20 July 2009 16:44 UK

Halliburton profit down by a half

Oil rig extracting petroleum in Culver City
Oilfield services firms have been hit by customers' falling spending

Oilfield services provider Halliburton saw its profits plunge by almost a half between April and May, a smaller fall than analysts had expected.

Net profit came in at $262m (£159m), down 48% on the $504m the company made in the same period last year. Revenue slipped 22% to $3.49bn.

Weak demand and the consequent fall in oil and gas prices hit the firm hard.

Halliburton said there was unlikely to be any "meaningful recovery" in demand during the rest of the year.

It blamed the fall in the price of natural gas in particular as the main drag on earnings.

'Substantial declines'

Oil and gas producers began scaling back exploration and production last year as prices tumbled.

The cost-cutting steps have hit oilfield services companies hard.

Given the dramatic fall in prices, the big drop in profit at Halliburton came as no surprise to analysts.

"Year-on-year declines are pretty substantial, but I think that was understood and expected," said Jeff Tillery at Tudor, Pickering, Holt & Co.

Kurt Hallead at RBC Capital Markets argued that the company had done well considering the tough trading conditions: "Given the declines that continued in North America in the second quarter, it's actually a pretty decent showing."

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